The SUNSET Rule mandates HHS to assess its regulations every ten years to determine whether they are subject to review under the Regulatory Flexibility Act (RFA).  If a given regulation is subject to the RFA, HHS must review the regulation to determine whether the regulation is still needed and whether it is having appropriate impacts.  Regulations will expire if the Agency does not assess and (if required) review them in a timely manner.  The complaint alleges that the rule exceeds the Agency’s authority and is arbitrary and capricious, as it obligates HHS to review regulations at a pace that the Agency will not be able to achieve, which will result in the elimination of regulations that structure the plaintiffs’ operations and businesses, delineate their obligations and rights, or protect their members and the populations they serve.

By way of background, the Trump Administration released notice of the proposed SUNSET rule the day after the 2020 election and scheduled it to take effect on March 22, 2021.  The lawsuit alleges that the Trump administration rushed the rule and did not provide the public with enough time to comment.

The Biden White House has called for a regulatory freeze on any last-minute regulations approved by the Trump Administration.  As a result, HHS has delayed several Agency rules so far.  Plaintiffs filed the lawsuit against HHS, as the Agency has not yet issued a stay in response to the White House’s announcement.  It is unclear whether the SUNSET Rule will be impacted by the Biden Administration’s regulatory freeze before it takes effect on March 22, 2021.

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